Up in smoke: $1.2 million cigarette scam

Hong Kong customs seized nearly four million cigarettes, worth over $1.2 million, in a two-week operation aimed at stifling smuggling in the territory, officials said on Saturday.

Authorities arrested seven people aged between 23 and 63 in the operation, which started in mid-December.

"Two cross-boundary vehicles conveying illicit cigarettes were seized and five illicit cigarette storage points were smashed," a government statement released on Saturday said.

Customs said that almost 90 percent of the seized cigarettes were found on two vehicles crossing the border from mainland China into the city.

Some of them were found in concealed spaces within containers carried by the vehicles.

"The total market value was estimated at HKD$10 million (US$1.29 million) with a duty potential of about $6.7 million," the statement said of the cigarettes.

"It was believed that the suspected illicit cigarette syndicate had been smashed," the statement added.

A picture released by the government showed packs upon packs of the seized cigarettes being displayed with brands including Marlboro and Chinese manufactured Double Happiness, among others.

Smuggled cigarettes worth nearly $1 million were seized by customs in the last major operation in November.

Cigarette smuggling in the southern Chinese city has been on the rise. A total of about 38 million cigarettes were seized in the first 11 months of 2013, compared to 27 million in the same period in 2012.

The former British colony is especially prone to cigarette smuggling due to its proximity with mainland China, with which it is connected by a land border.

Under Hong Kong laws, the maximum penalty for smuggling is a fine of HK$2 million ($250,000) and a seven-year jail term.